Member Info for SquirtyFlower

My reading of the email is just that the Bushveld Vanadium update will come before the BE update. I don't see where it says or suggests the BV update will arrive in October. It may be October, but equally both can be released in Nov and Chika's words remain perfectly true (to the point that BV could be released on 29 Nov and BE on 30 Nov in the most extreme case).

As I mentioned a couple of weeks ago, any ongoing selling by First Island is almost certainly investment rule driven rather than any concern they have with BMN (after all, their investment has been spectacularly successful so far). As an II - a trust no less - FI will be required to remain within various investment criteria/rules.

1) As I stated a couple of weeks ago, it will have been no coincidence that FI executed the trades which dropped them below the 3% reporting threshold exactly 1 day before the 6 month birthday of their investment (see the RNS for the trade date). This will have been because they had a rule which said they needed to do this and the selling was almost certainly pre-determined back in March when they first invested. Over the 6 months they would have tried to secure the best prices they could, but absolutely nothing was going to make them miss their 6 month deadline.

2) More recent selling (if it is them, the pattern seems to fit though so most likely them) will be the result of one or more of at least 3 rules:
a) another rule saying now get below x% (lower than 3%) within 9 or 12 months
b) (as mentioned earlier today by other) a rule requiring them to start taking out their original investment so that they minimise risk of losing their initial investment. Even though making a loss on BMN is now highly unlikely, they will not be taking any chances and they will likely have a rule that mandates they must reduce/eliminate this risk when possible.
c) because of the success to date of their BMN investment, they may well have fallen foul of a rule which mandates no more than x% of their portfolio in any one company. The fact the market has fallen sharply elsewhere may have exacerbated this. Lots of IIs have a similar rule (as do a lot of PIs...though BMN seems to be causing a few to break this rule!). Again this is for risk management reasons.

All-in-all, imho the selling should just be seen as a golden opportunity for others to take advantage of FI being required to sell because of their investment rules.

Personally I think the 1m trade was a buy. The reported trade time was 0803 this morning, so it could well have been a buy order that was primarily worked yesterday and completed the first few mins this morning....hence the significant upward pressure on the share price yesterday. If it was a sell, I'd have expected the MMs to try to shift the ask up over 30p (maybe up as high as 31/32p) to make themselves a tidy 5-10% on shifting the shares they'd taken on.

In October 2016 - just 2 years ago - the BMN share price went down to 1.2p. It spent days under 1.3p.

We currently sit at 27.5p (mid) .... an increase of approx 23x over the low
A couple of weeks ago, we peaked at 32p....and increase of 27x over the low....and most expect this high to be breached well before Christmas never mind where new highs may hit over the next few years.

In comparison, Fevertree Drinks has been an undoubted darling of the UK market. For most of the last 2 years you cannot open a newspaper (certainly not the business sections), go to a pub/party, or read a supermarket marketing magazine without seeing some mention of them. Publicity and broker recommendations coming out of their ears.

Fevertree floated at 134p in Nov 2014. Within a couple of days it was over 160p.

It currently sits at 2958p - a 22x rise from the float price (and 16x from the 160p level).
It peaked at 4100p+ - a 31x rise from the float price. (26x from the 160p level).

In Oct 2016, it was kicking around the £10 mark so has grown 3x to date from there (and 4x to peak).

I appreciate it is not exactly a fair comparison because BMN fell a long way to 1.2p and FEVR is from the float, but still BMN has achieved comparable growth in the last 2 years to FEVR in 4 years. I think people need to bear this in mind when they moan incessantly about SPA/Meyer or the communications or the difficulty of doing business in SA or shorters (real or imagined) or IIs who may or may not be selling more than declared to date. The odd grumble is fine and normal, but keep it in perspective. The world is not out to get BMN so a lot less paranoia, negativity, fighting among people on the same side on this BB, and a lot more realism on just how well things are going for BMN and its investors seems in order to me. The market is rewarding BMN on a par with the darlings of the market and a lot of people here are becoming very wealthy as a result. Even better - there's a long, long way still to go on the good news and in the growth.

kev - institutional investors do not think or operate the same way that PIs do. I made this point during the Erongo sell-off when people on here could not understand why they'd sell and the same applies to First Island Trust. When an II makes a decision to buy or to sell then the decision is made - they will not revisit it, they will just get on with it. IIs operate within a set of investment rules and they will not deviate from them under almost any circumstance, so if the rule says we sell x% of our holding every 3 months then that is what they'll do regardless of whether they think the company's long term future is wonderful or woeful.

In the specific case of FIT and BMN, it is worth noting that the day they crossed the 3% threshold was exactly 1 day short of 6 months from when their shares were admitted to the market. Therefore it seems highly probable they had a rule which said they had to get under 3% within 6 months i.e. a decision made back in March (or more probably sometime before they'd even heard of BMN as they would do the same on any investment). They gave the shares as long as possible to appreciate - which is why they sold late in the 6 month cycle - but the rule was sacrosanct and they executed a set of trades to meet it. No sentiment involved, just follow the rule.

These rules are about risk management. The last 2 days of action on Patisserie Valerie have given a perfect example of why II's operate like this, especially on AIM. On Monday no-one in the company knew there was a problem (except the FD who has now been suspended), on Tuesday they internally discovered a big black hole in the accounts, on Wednesday they announced suspension of shares, and this afternoon they've said the company will cease trading without an immediate cash injection. That's how fast things can go t*ts up and why IIs manage their risk programmatically according to a set of rules. Some they win, some they lose, but this is how they manage their risks overall for their own internal auditors and their investors.

Basically the share price had moved too much in too short a space of time so a 'circuit breaker' automatically cuts in to halt the share pending clarity about the reason(s).

Interesting flurry of trades in last 15 mins on BMN too. Share price saw strength into the close - bodes well for tomorrow.

Rob1967 - I assume you are referring to the 250K trade at 13:56. If so, then I think this is Nick's 250K buy given he posted about it at that price at 13:58. In light of this, the 2 * 100K trades and the 105K trade from around the same time may all also be buys.

Endion - think your maths has gone awry. A 1p dividend would cost just over £10m as we have just over 1bn shares.

I do think it is just a matter of time and patience before we see serious sp growth from here and movement to what PIs would see as a much fairer valuation of the company. As BBN and others have observed, it is clear if you read into the RNS that the company has got serious ambitions and credible plans to achieve them. Not everything will be achieved or on the timescale suggested by the ambition, but the majority of them will get there in due course.

However, what we do not yet have are:

- a growth roadmap which is clearly understood and evaluated as realistic by higher profile market players (some of the bigger IIs, key market influencers and analysts....in football terms, SP Angel are no more than a Vanarama Conference or below II, though they are better than the Sunday morning clogger outfits we previously had to put up with). Once we attract the interest of a couple of the 'Championship' level or above II's then we'll move quickly, but at the moment these players just don't see the roadmap never mind having evaluated it (realistically, most will probably have barely heard of BMN).

- sustained performance against visible revenue and earnings targets measured in the hundred of millions of pounds or more. 1H18 (unaudited) was the first time we've achieved substantial revenue and EBITDA and it's going to take another 18 months or so to start getting a good reputation for sustained high quality financial performance with the higher quality market players, but the real top-level II's will want to see financial growth targets looking out 3-5 years+ minimum.

I think over the next 6 months FM will start laying out the roadmap in a lot more detail (not just the Vametco expansion, but the BE story, the BMN/BE revenue and earnings projections, dividends, etc.) and substantially increase the pace of getting more of the key market influencers name-checking BMN/BE in more visible places (the right ears in the city, more influential trade press, national press, etc.). This is where Michael Kirkwood will come into his own and, imho, what he's really been brought on-board for. I also wouldn't be surprised to see another similar appointment in due course (ideally alongside getting a higher quality/profile broker....Investec would be great with their SA connections....and ditching SPA).

The future of BMN/BE is staggeringly good, but for the reasons above I suspect it is still going to take 18 months+ before we really start to see the share price begin to hit levels we think it ought to. Until then, PIs ought to just relax, stop worrying about MMs/shorters and their daily games, stop worrying about the 10% share price movements, stop worrying about the time-wasters who come on here, stop picking fights with each other over really trivial things in the grand scheme of things, and just enjoy the ride of their lives.

Wow indeed. Approx 10% share dilution but at 25% discount to share price. More importantly, this is the justification for the money raised:

"The Company intends to use the net proceeds it receives from the Placing to progress delivery of its current pipeline and provide the time to attract strategic partners to support and finance the continued growth of the business."

To me, that reads like a 'we need the money to keep the lights on and desperately hope we can find new investors before we go under.'

Very different start to trading today - less than 100K shares published in the first 30 mins. When the pattern changes, it suggests a shift in sentiment is occurring. MMs might try to take it down again to try to flush out a few more sells, but I do think the selling is getting exhausted (both from Rhino and from PIs taking profits from the rise up to 30p) and we'll soon start moving up again.

Impressive achievement, Charlie, to have won the 'dunce of the week' award before 10.30am on Monday.

MMs get dividend on any qualifying shares they hold otherwise they would lose money because the ex-div price is adjusted down to reflect the dividend. For example, if the BMN sp was 30p immediately prior to qualification for a 1p dividend (i.e at the point of going ex-div) then the next day BMN would (assuming no other factors) open at 29p the next morning. If the MMs didn't get the dividends then they would have to eat this as a 1p loss on the shares they bought the day before....and that just ain't gonna happen.

In many ways, I'm not overly disappointed about this missing from the RNS. We know it is coming and a separate RNS under the heading 'Bushveld Minerals announces dividend policy and maiden dividend' will have a very strong impact by itself. We've often wished the company would issue more positive RNS rather than roll together lots of items, and separating the 1H results (backward looking/historical info) from dividends (forward looking) would be a perfect example of better managed news flow. All imho, of course.

As our troll seems to be comparing FCF across companies, how about comparing with BOO which is one of the largest companies on AIM. In their last results (finals, 25th April 2018) they had a FULL-YEAR FCF of £29.9m compared to BMN's 1H18 FCF of £10.1m (note to troll, the BMN figure is in GBP not USD as you erroneously keep stating....do get the basics right). BOO's current MCAP is £2.4billion. I won't ask you to explain because it is factually evident you don't know what you're talking about comparing FCF to MCAP.

There you go, Alfa - a 7309 trade at 9.55am....end of the warrants?

Alfa's analysis yesterday suggested it was the MMs who were short to the tune of 1.4m shares based on what they had bought/sold to investors. He will correct me if I'm wrong, but I don't think he was suggesting he wasn't suggesting it was another player (i.e. a planned shorting attack) that was in deficit. The strike started on Wednesday evening so I can believe that the MMs got wind of events as they're often quite well plugged into events and so ran themselves short yesterday but, based on my reading of Alfa's analysis, I don't really see evidence that someone else took a short position based on knowing about the strike. If someone was going short, then presumably the MMs must have bought more than they sold to accommodate them.....the exact opposite of Alfa's analysis.

I also note that there was no unusual share trading activity prior to the RNS today - in fact it was a pretty quiet morning until then - so I think that also puts paid to the idea suggested last week about the MMs getting to see RNS an hour before everyone else does. They certainly got no warning about this one.

I think Dignity has also disappeared now....not surprising really given this is the same nickname as a listed company (Dignity PLC, LON:DTY) and so clearly fell foul of LSE posting rule #3.

Also, looking ahead into 2019, then I see the absolute minimum annual production being 4000mtV given we should be up to 3750mtV capacity by year end 2018 and 5000mtV by year-end 2019. My 4000mtV minimum expectation allows for a modest ramp-up rate through the year as well as some outages/reduced rates for short periods as part of the expansion. This represents a minimum 35% production increase and, in practice, my actual expectation is somewhere just above 4500mtV (a 50% increase over 2018). I also see little likelihood of the vanadium pricing pressures abating (sure there may be some periods where they drop a little), but a $75kgV average still seems a reasonable working assumption, and I also see the production costs per kilo reducing as output increases.

Therefore, in summary for 2019, I expect:

- Revenue for BMN alone (not BV) in the range GBP 120-140 million
- EBITDA for BMN alone (not BV) in the range GBP 60-80 million.

And all this assumes nothing for Brits, Mokopane, Sojitz, BE, or dividends, etc.

Whenever you get tempted to get sucked into the day-to-day cr*p on here about 10% share price decreases, posters trying to wind the board up, paranoia about shorting (who really cares, it’s so trivial at the moment as to be irrelevant so good luck to them if they want to try), issues with company PR, T20’s (again who really cares, good luck to those who take this path), the bottom line is that everything boils down to revenue, profit, and cash flow. BMN has these by the bucketload and they will only improve in 2019. Therefore, if you just hold your shares and ignore the nonsense, then in the long run there is nothing that the Market Makers, the warrant holders, the shorters, the traders, the impatient, etc can do to prevent you making huge gains on your shareholding here over the next 24 months. The only person who can prevent you is yourself.

I posted the following last week.

“It was the 7% royalty that I was missing. Armed with this knowledge, I worked some numbers for 2H18 using the following assumptions:

- 2H18 production = 2H18 sales = 1600mtV. This takes FY18 production to 2960mtV so within the latest guidance.
- average sale price of $75/kgV
- 2H18 SG&A is $8.66M (flat on 1H)
- mid-guidance 2H18 production costs of ZAR 245/kgV ($19.44/kgV using Q2 exchange rate).

Using these, in 2H18 Bushveld Vametco (BV) would generate:
- $120M revenue
- $8.4M royalty payments
- $8.66M SG&A
- $31.1M production costs
- $71.9M EBITDA (of which $42.49M (59.1%) would be attributable to BMN).

Taken with the 1H18 numbers from this week’s RNS , this would give FY18 results of:

- $205M revenue for BV
- $114M EBITDA for BV

- $121.4M revenue for BMN (GBP 94.5M)
- $67.5M EBITDA for BMN (GBP 52.6M).

All-in-all, a very healthy projected set of results.”

Further to this previous post, I would now like to add that even if there continues to be some grade issues and the odd bit of industrial/community action, I find it very, very difficult to see how FY18 EBITDA for BMN will be less than GBP 45M in the absence of some major catastrophe such as a fire at Vametco. If anything, the sale price and production cost assumptions seem to be working further for the company rather than against it and I could actually see BMN getting towards GBP 60M EBITDA for FY18 if everything went superbly well in 2H18.